Reid, Executive Director in EY’s specialist insurance department, has also commented on what the forthcoming announcement of ILS regulations may mean for the global insurance, reinsurance and ILS market, highlighting the complementary nature of a UK ILS hub.

“The insurance industry will welcome the Chancellor’s confirmation to publish regulations to develop the ILS market in the UK, which is expected to allow re/insurers and brokers operating in the London insurance market to develop and issue new products, supported by alternative capital.

“It will be an important growth opportunity for the industry. To be successful, this new market must be complementary to other global ILS centres, and to meet the new requirements of global insurance buyers, London’s world renowned reputation for product innovation should be harnessed,” said Reid.

The draft regulation consultation paper, while definitely a step in the right direction, didn’t mention any new or unique elements to the proposed London and UK ILS market, and instead focused on collateralised reinsurance, the establishment of a protected cell company, and certain taxation and supervisory/authoritative issues.

Artemis has discussed this notion before, underlining the need for London to bring something new and innovative to the ILS space that will make it irresistible when compared to other domiciles and in order to complement rather than compete, so it’s promising to hear that developments are still ongoing despite no mention in the Chancellor’s most recent announcement.

“I hope the interdependency between the UK and other ILS centres means that these regulations and potential product developments are mutually beneficial across the global re/insurance market; whilst these are UK regulations, we must ensure nothing is done to the detriment of other ILS markets,” Reid told Artemis.

Sovereign ILS solutions, explains Reid, are a new and important opportunity that combined with the specialist nature of the London re/insurance market, could provide the London and UK market with an opportunity to grow its product set and capital base.

But importantly, and as we’ve continued to stress at Artemis, this should be done with the goal of expanding the remit of the entire ILS space, with complementary initiatives focused on the skills of specific centers, which in turn should benefit all ILS domiciles, old and new.